Expressing confidence in India’s potential to achieve over 7% GDP growth in the current financial year, Reserve Bank of India Governor Shaktikanta Das has said that the country’s growth drivers are gaining momentum.
Referring to the Indian Monetary Fund (IMF) and World Bank’s recent growth forecasts for India in 2024-25 at 7.0%, Governor Das said that these were in line with the RBI’s own projection of 7.2% for the current financial year. He was speaking at FIBAC 2024.
The Governor’s confidence in the country’s growth trajectory comes from two key drivers: consumption and investment demand. Data indicates that private consumption, which makes up about 56% of GDP, has grown from a muted 4% in the second half of the previous financial year to a significant 7.4%, indicating a revival in rural demand. Industry and the services sector, too, have recorded steady growth while agriculture is expected to pick up during the course of the year. When it comes to lending, credit to sectors including agriculture, industry and MSMEs remains robust.
Food inflation outlook, which has contributed to inflationary concerns in the past, is also expected to be more favourable over the year owing to a good monsoon season that is progressing well and a healthy kharif sowing season that is likely to result in better harvests. The Governor is confident that the balance between inflation and growth is well-poised.
India is geared for inclusive growth as it aims to join the ranks of developed nations. The South Indian Bank is proud to be doing its part in laying a strong financial foundation for the country’s citizens as they participate in this growth story.
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